GMB union voice opposition to private contractor Civica taking on Thanet’s council tax, housing benefit and debt recovery service

Thanet council

The GMB union says it will formally protest the plan to outsource the shared service that deals with council tax, housing benefit, non-domestic rates, debt recovery and customer services for Thanet, Dover and Canterbury.

The proposal was agreed this week to sign contracts allowing private contractor Civica UK to take over the services on February 1.

The outsourcing of the East Kent Services (EKS) functions, which currently looks after those areas for the three councils, is aimed at cutting costs without the need for redundancies.

A report to members of the East Kent Services Committee,  who agreed the proposals yesterday (January 24), said the outsourcing to Civica will provide: “Immediate savings via reduction in costs of EKS operation on day 1.

“Safeguards existing jobs and prevents redundancy costs; possible additional “one-off” savings in Year 1 and an income, shared between Civica and the three councils.”

Civica will take on:

  • Council Tax Administration and Enforcement
  • National Non-Domestic Rates Administration and Enforcement
  • Housing Benefit and associated services
  • Council Tax Reduction Scheme and associated services
  • Debt Recovery
  • Customer Services

‘Profits before people’

But the GMB will be writing to all three councils to formally ask that the process be halted and that due consideration is given to keeping these public services in the public domain.

Frank Macklin, GMB Regional Organiser said:”The future of Thanet council hangs in the balance due to the local plan being rejected by the elected councillors and various political parties are fighting each other around the issues surrounding the future of the Manston Airport site.

“GMB believes that with Carrillion going into receivership, all public sector contracts should be looked at with a view to bringing these contracts back into public hands and away from companies that puts profit before people.

“For too long now we have seen public services handed to the public sector where savings are made by reducing the workforce and putting more reliance on self-service which can often lead to confusion and often lead to members of the public simply walking away and not getting the help, advice and the support they so badly need.

“GMB will be writing to all three councils to formally ask that this process be halted and that due consideration is given to keeping these public services in the public domain.”

East Kent Services

EKS was formed five years ago to provide IT,HR, revenues and benefits and customer services. It has saved the three councils £6million but from this year the organisation would have needed to make savings of between £300,000 and £500,000.

A previous report to Cabinet members said this would require some 30 redundancies. EKS currently employs 300 people.

Staff affected by the contracting out of services are to transfer under Transfer of Undertakings (Protection of Employment) Regulations (“TUPE”). to Civica.

The three councils have agreed to sign contracts with the firm for a period of 7 years plus the option to extend by a further 3 years.

Future restructure

This leaves EKS with just ICT services, HR, some quality assurance aspects and contract management.

The report says: “In addition to the operational savings within EKS from the contract price, there will be additional savings from a future restructure within the remaining elements of EKS, overseen by the Councils’ Heads of Paid Service. It is anticipated as the residual element of EKS will be able to achieve some efficiencies due to the reduction in scale of the overall organisation.”

The amount saved by outsourcing to Civica has not been made public due to ‘commercial confidentiality’ but is thought to be worth some £80million.

The report states: “Entering into the contract will result in a significant reduction in the operating cost of EK Services and consequently reductions in the contributions made to EK Services operating costs by each of the partner councils, providing direct cashable savings to each council.

“It also provides a high likelihood of income generation over the lifetime of the contract through a combination of profit share and rental income. In addition, agreeing the recommendation would avoid an estimated £1.2m of redundancy costs over the next 7 years and/or the need to increase the contributions paid by the partner councils to meet the operating costs of EK Services of circa £2m over the same period.”

4 Comments

  1. The costs and savings will not be disclosed due to “commercial confidentiality”. Well let those whose money we are talking about be involved in this. The contractor who collect the money, the authorities who administer the monies collected, and the council tax payers who put up the money in the first place, all of these factions should have open access as to what is going on. So it’s time to pull the plug on this confidentiality clause nonsense. If I’m allowing third parties to spend money I want transparency and accountability from whoever is spending it on my behalf.

  2. The service provided to the customer will fall making it harder or even impossible to sort out discrepancies and problems regarding council tax, benefits and debts with a private company looking to make a profit out of you. I can see a lot more people put into spiralling debt when not having Council staff to help them sort any matters out because of this move to Civica. It should be People before profits!
    This just should not happen with public services.

  3. No private company has the legal right to demand council tax any more than does your local newsagent. Also, a private company is out to make money for itself, not provide a public service.

  4. It’s easy for “Civica” to quote a low price at the start of negociations. This just looks good for the voters. But after a while, when the Council no longer has the trained staff to organise the job, the charges will go up and the Council will flounder at the thought of having to run it themselves. Thanet Council hasn’t exactly got a good reputation for being well run these days.

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